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News: On a higher base, revenue declined by 9.5% YoY (down ~16% QoQ) to Rs 134.2 crore. On a three-year basis, revenue grew at a CAGR of 15%. Gross margin declined by 234 bps YoY (flat QoQ) as a result of inferior product mix and delay in taking price hikes. EBITDA margin declined by 69 bps YoY (down 178 bps QoQ) to 13.4% mainly due to lower gross margin. PAT declined sharply by ~52% on both YoY and QoQ basis to ~Rs 4.5 crore as a result of higher depreciation and interest cost.
Views: We believe, Shaily posted a disappointing performance on all fronts. We believe decline in revenue is majorly on account of subdued demand in the home furnishings segment. The reported EBITDA margin of 13.4% is still lower than its pre-Covid level EBITDA margin range of 16-17%. We await management commentary on future revenue growth guidance and sustainable EBITDA margin guidance going forward
Impact: Negative